Core Viewpoint - The Hong Kong stock market opened lower, with the Hang Seng Index down 0.51% and the Hang Seng Tech Index down 0.83%. Notable stocks like Hua Hong Semiconductor and BeiGene showed mixed performance, while the market anticipates a positive long-term outlook for innovative drugs despite recent adjustments in the healthcare insurance directory [1]. Market Performance - The Hang Seng Index opened down 0.51% and the Hang Seng Tech Index down 0.83% [1]. - Hua Hong Semiconductor opened down 3.87%, reporting Q3 sales revenue of $635 million, a year-on-year increase of 20.7% [1]. - BeiGene opened up 3.02%, with total revenue for the first nine months approximately $3.845 billion, a year-on-year increase of 43% [1]. - The Hang Seng Biotech Index opened lower but showed narrow fluctuations, with the Hang Seng Pharmaceutical ETF experiencing a slight decline [1]. Healthcare Insurance Directory Adjustment - This year marks the 8th adjustment of the healthcare insurance directory since the establishment of the National Healthcare Security Administration, with the notable addition of a commercial health insurance innovative drug directory [1]. Innovative Drug Market Outlook - The innovative drug sector has experienced a significant correction over the past three months, but the market expectations have lowered without impacting the fundamentals [1]. - There are multiple catalysts expected in the short term, including continued growth in Q3 performance and ongoing business development (BD) opportunities [1]. - Long-term prospects for innovative drug companies are expected to improve, maintaining a high level of enthusiasm for overseas expansion [1]. Investment Thesis - Dongwu Securities believes that innovative drugs will remain a key investment theme through 2026 due to their rising international status, explosive growth in overseas business development, significant market capitalization potential, and a transition to profitability [1]. - Key focus areas for innovative drugs include the next generation of ADC+2.0 IO and small nucleic acids [1].

Core Viewpoint - The stock of Zhifei Biological has shown fluctuations, with a recent increase of 2.02% and a year-to-date decline of 19.32%, indicating potential volatility in the market [1][2]. Company Overview - Zhifei Biological, established on July 20, 1995, and listed on September 28, 2010, is based in Chongqing and specializes in the research, production, and sales of vaccines and biological products [1]. - The company's revenue composition includes 88.84% from agency products, 10.15% from self-developed products, and 1.00% from other sources [1]. Financial Performance - For the period from January to September 2025, Zhifei Biological reported a revenue of 7.627 billion yuan, a year-on-year decrease of 66.53%, and a net profit attributable to shareholders of -1.206 billion yuan, a decline of 156.10% [2]. - Cumulatively, the company has distributed 7.318 billion yuan in dividends since its A-share listing, with 3.194 billion yuan distributed over the past three years [3]. Shareholder Information - As of September 30, 2025, the number of shareholders for Zhifei Biological was 131,600, a decrease of 3.17% from the previous period, with an average of 10,750 shares held per shareholder, an increase of 3.28% [2]. - The top ten circulating shareholders include significant institutional investors, with notable reductions in holdings for several funds, indicating potential shifts in investor sentiment [3].

Core Viewpoint - Kangyuan Pharmaceutical's stock has shown fluctuations with a year-to-date increase of 11.38%, but recent performance indicates a decline over the past 60 days by 10.82% [1] Group 1: Stock Performance - As of November 7, Kangyuan Pharmaceutical's stock price reached 15.17 CNY per share, with a trading volume of 73.44 million CNY and a turnover rate of 0.86% [1] - The stock has experienced a net outflow of 429,200 CNY from main funds, with large orders showing a buy of 11.98 million CNY and a sell of 12.21 million CNY [1] - Over the last five trading days, the stock has increased by 1.47%, while it has decreased by 1.56% over the last 20 days [1] Group 2: Financial Performance - For the period from January to September 2025, Kangyuan Pharmaceutical reported a revenue of 2.343 billion CNY, representing a year-on-year decrease of 24.66% [2] - The net profit attributable to shareholders for the same period was 200 million CNY, down 44.10% compared to the previous year [2] Group 3: Shareholder Information - As of September 30, 2025, the number of shareholders for Kangyuan Pharmaceutical increased to 40,500, marking a rise of 17.20% [2] - The average number of circulating shares per person decreased by 14.68% to 13,969 shares [2] - The company has distributed a total of 949.8 million CNY in dividends since its A-share listing, with 345 million CNY distributed over the last three years [3]

1. Report Industry Investment Rating No information about the report industry investment rating is provided in the content. 2. Core Viewpoints of the Report The report presents a comprehensive overview of the global financial market, including stock markets, commodity markets, bond markets, and foreign exchange markets, as well as important macro - economic and industry - related news. It reflects the current market trends, such as the decline in major global stock indices, fluctuations in commodity prices, and changes in bond yields. Additionally, it covers significant events like corporate mergers, policy announcements, and international cooperation initiatives. 3. Summary by Relevant Catalogs Overnight Night - Market Trends - US major stock indices closed lower, with the Dow down 0.84% at 46912.3 points, the S&P 500 down 1.12% at 6720.32 points, and the Nasdaq down 1.9% at 23053.99 points [5] - European major stock indices also closed lower, with the German DAX down 1.29% at 23740.38 points, the French CAC40 down 1.36% at 7964.77 points, and the UK FTSE 100 down 0.42% at 9735.78 points [6] - US Treasury yields fell across the board, with the 2 - year yield down 7.20 basis points to 3.553%, and others also showing declines [6] - International precious metal futures generally declined, with COMEX gold down 0.20% at $3984.80 per ounce and COMEX silver down 0.37% at $47.85 per ounce [7] - US oil and Brent crude futures declined slightly, with US oil down 0.12% at $59.53 per barrel and Brent crude down 0.08% at $63.47 per barrel [9] - Most London base metals rose, with LME copper down 0.1% at $10687 per ton, and others showing various changes [9] Important News Macro - economic News - Xi Jinping emphasized the strategic goal of building the Hainan Free Trade Port to be an important gateway for China's opening - up in the new era [11] - The Ministry of Commerce reported on the results of China - US economic and trade consultations in Kuala Lumpur, including issues such as fentanyl, tariffs, and agricultural trade [11] - China is actively promoting its accession to the CPTPP [11] - As of November 5, 2025, the annual customs clearance volume of the Ceke Port exceeded 26 million tons, a year - on - year increase of 25.7%, and it is expected to exceed 30 million tons in 2025 [12] Industry News - For the soda ash industry, this week's shipments, production, and overall inventory in China showed certain changes [14] - In Japan, commercial crude oil and gasoline inventories increased, while kerosene inventory decreased, and the refinery's average operating rate rose slightly [14] - In Singapore, fuel oil and light distillate inventories decreased, while middle distillate inventories increased [15] - In the US, the natural gas inventory increased by 33 billion cubic feet in the week ending October 31, 2025 [15] Metal Futures - A polysilicon restructuring "consortium" platform is being planned, with a proposed fund size of about $70 billion [17] - As of this Thursday, the national metallurgical - grade alumina's total production capacity and operating rate showed some changes [19] - Global gold ETFs had five consecutive months of capital inflows, with significant growth in asset management scale and trading volume in October [19] - The mining rights transfer income assessment report of a mine in Jiangxi is being publicly announced [19] Black - series Futures - For rebar, production, apparent demand decreased, and factory and social inventories continued to decline for four weeks [21] - The capacity utilization rate of coking coal mines decreased, and there were changes in coal production and inventory [21] - The average profit per ton of coke in independent coking plants showed different levels in different regions [21] Agricultural Futures - In southern Mato Grosso, Brazil, the soybean and corn yields increased significantly, and the second - season corn output is expected to rise substantially [24] - As of November 5, 2025, the apple cold - storage inventory in China's main producing areas decreased year - on - year [25] - In Malaysia, palm oil production increased in the first five days of November [25] - Brazil's November exports of soybeans, soybean meal, and corn are expected to be higher than last year [25] - India may double its sugar export quota in the new year [26] Financial Market Financial - A - shares rose unilaterally, with the Shanghai Composite Index back above 4000 points, and some sectors and concepts showed different trends [28] - The Hong Kong Hang Seng Index and related indices rose, and there were new stock listings and performance [29] - MSCI announced the November index adjustment results [29] - The China Securities Index Company will launch new indices [30] - The Science and Technology Innovation Board of the Shanghai Stock Exchange accepted the IPO application of Core Medical [30] - Hong Kong is promoting dual - currency trading of some local stocks and related measures [30] - The second - batch of long - term investment pilot insurance funds has made progress [30] - Guizhou Moutai held a performance briefing [31] - DeepWay submitted a prospectus to the Hong Kong Stock Exchange [32] Industry - The polysilicon industry may undergo major integration [33] - The financial regulatory authority is formulating guidelines for the high - quality development of science and technology insurance [33] - China will promote international cooperation in the new - energy storage field [33] - The construction machinery industry's October operating rate showed certain changes [33] - Chongqing issued policies to support the high - quality development of innovative drugs [34] Overseas - US President Trump reached an agreement on GLP - 1 weight - loss drugs, and there are investment and factory - building plans [35] - The US employment situation is severe, increasing the expectation of interest rate cuts [35] - The US government shutdown affects official inflation data and policy - making [35] - Some Fed officials have different views on interest rate cuts due to inflation concerns [36] - The US government shutdown affects the aviation industry, with flight capacity cuts [36] - The Bank of England maintained the interest rate at 4%, and the expectation of a December interest rate cut increased [36] - Japan plans to allocate about $6.5 billion annually to support the local chip and AI industries [38] - Japan's nominal wages increased in September, which may affect the central bank's policy [38] - Germany's industrial output showed a certain recovery in September [39] International Stock Markets - US major stock indices closed lower, with some individual stocks performing poorly, and there were concerns about Trump's tariff policies [40] - European major stock indices closed lower, affected by multiple factors [40] - Multiple valuation indicators of the US stock market are at high levels [41] - Nissan had a net loss in the first half of fiscal year 2025 and plans to sell its headquarters building [42] - Airbnb's third - quarter performance was good, and its after - hours trading price rose [42] Commodities - International precious metal futures declined [43] - Oil prices fell due to concerns about supply and demand [43] - Most London base metals rose [43] - Indonesia stopped approving applications for some nickel ore processing plants [43] - Saudi Aramco lowered the December crude oil price for Asia [45] - The US included copper in the 2025 key minerals list [45] Bonds - The Ministry of Finance issued $4 billion in sovereign bonds in Hong Kong, with high subscription rates [46] - The strength of A - shares put pressure on the bond market, and there were changes in bond yields and prices [46] - The real estate industry's bond financing in October increased year - on - year [46] - US Treasury yields fell [47] - Berkshire Hathaway may issue yen bonds [48] Foreign Exchange - The on - shore RMB against the US dollar rose, and the RMB was added as a settlement currency by the IATA [50] - The US dollar index fell, and most non - US currencies showed different trends [50]

Core Viewpoint - BeiGene, a leading innovative pharmaceutical company in China, reported significant financial growth in Q3 2025, with total revenue reaching 27.595 billion yuan, a year-on-year increase of 44.2%, and a net profit of 1.139 billion yuan, recovering from a loss of 368.7 million yuan in the same period last year [2][4]. Financial Performance - Total revenue for the reporting period was 10,076.964 million yuan, reflecting a 41.1% increase compared to the same period last year [3]. - Product revenue amounted to 9,953.836 million yuan, up 40.6% year-on-year, contributing over 98% to total revenue [4]. - The company achieved a total profit of 746.452 million yuan, with a net profit attributable to shareholders of 688.812 million yuan [3]. Product Performance - The core growth drivers for BeiGene's performance were the sales of its BTK inhibitor, Brukinsa (Zebutinib), and the PD-1 monoclonal antibody, Tislelizumab [3][4]. - In Q3, Brukinsa generated global sales of 74.23 billion yuan, a 51.0% increase, accounting for over 70% of the company's product revenue [4]. - The U.S. remained the largest market for Brukinsa, with sales of 52.66 billion yuan, up 46.9%, while European sales surged by 68.2% to 11.65 billion yuan [4]. Market Outlook - The company has adjusted its 2025 revenue forecast, raising the expected range from 35.8 billion to 38.1 billion yuan to 36.2 billion to 38.1 billion yuan [4]. - Research and development expenses, along with sales and management costs, have been narrowed from 29.5 billion to 31.9 billion yuan to 29.5 billion to 30.9 billion yuan [4]. Pipeline Development - BeiGene is advancing its next-generation self-developed pipeline products globally, with the film-coated tablet formulation of Brukinsa approved by the European Commission [5]. - The company plans to submit a marketing application for Brukinsa for marginal zone lymphoma in Japan in the first half of 2026, aiming for orphan drug designation [5]. - The company has also initiated the first patient enrollment for the Phase III clinical trial of Tislelizumab for gastric cancer and submitted a marketing application in Japan [5].

Core Viewpoint - The company Zhongsheng Pharmaceutical (002317) is advancing its innovative drug RAY1225, which has global intellectual property rights and dual agonistic activity for GLP-1 and GIP receptors, showing potential for bi-weekly administration in treating type 2 diabetes and obesity [1] Group 1: Product Development - RAY1225 is an innovative structural polypeptide drug with excellent pharmacokinetic properties [1] - The drug is currently in Phase III clinical trials for the treatment of type 2 diabetes and overweight/obesity patients [1] - RAY1225 has received approval from the U.S. Food and Drug Administration (FDA) to conduct Phase II clinical trials directly in the U.S. for indications related to overweight or obesity [1]

Group 1 - The company announced the establishment of a wholly-owned subsidiary, Guilin Jinma Innovation Investment Co., Ltd., with an investment of 70 million yuan to support its strategic planning and R&D needs [1][3] - The company operates in various fields including oncology, microbiology, cardiovascular, detoxification, digestive system, musculoskeletal system, gynecology, and neurology [1] - The R&D process is managed by the headquarters, with production bases conducting projects based on their characteristics and market layout, including both innovative and generic drug development [1] Group 2 - The company received a notice of acceptance for the market application of Amber Dihydroaminoacridine Tablets, a new drug for treating mild to moderate Alzheimer's disease, which has undergone extensive clinical trials since 2007 [2] - The company emphasizes that new drug development is a long-term, high-investment, and high-tech process, with uncertainties regarding market prospects and economic returns [2] - The establishment of the subsidiary is part of the company's strategy to transform into an innovation-driven modern pharmaceutical enterprise, enhancing its core competitiveness and ensuring sustainable development [3]

Core Viewpoint - The Hong Kong stock market has rebounded significantly since 2025, driven by improvements in the macroeconomic environment, strong performance in the technology sector, and increased liquidity, positioning it as a key investment opportunity globally [1][3][33]. Group 1: Fundamental Reversal - The technology sector in Hong Kong has seen substantial improvement in fundamentals, with major companies reporting strong revenue and profit growth. For instance, Alibaba's Q1 revenue reached 236.45 billion RMB, a 7% year-on-year increase, while its Non-IFRS net profit grew by 22% to 29.85 billion RMB [4]. - Tencent reported a 14% year-on-year revenue increase to 364.53 billion RMB in the first half of 2025, with a Non-IFRS net profit of 124.4 billion RMB, up 16% [4]. - Xiaomi's revenue for the first half of 2025 was 227.25 billion RMB, reflecting a 38.2% year-on-year growth, with a Non-IFRS net profit increase of 69.8% to 2.15 billion RMB [5]. - Other sectors, including innovative pharmaceuticals and semiconductors, also reported strong mid-year results, indicating a broad recovery in profitability across industries [6][7]. Group 2: Liquidity Support - The liquidity environment for Hong Kong stocks has improved significantly in 2025, with a cumulative net inflow of over 1,285.69 billion HKD as of November 4, 2025, marking a historical high [11]. - Monthly net inflows have consistently exceeded 110 billion HKD, with a record single-day net purchase of 35.88 billion HKD on August 5, 2025 [12]. - The inflow of capital has primarily targeted technology stocks, financials, and high-dividend assets, with Tencent and Alibaba being the most significant beneficiaries [10][12]. - The average daily trading volume in the Hong Kong market has stabilized at over 30 billion USD, nearly doubling year-on-year, indicating enhanced market liquidity [18]. Group 3: Future Key Points - The rapid development of AI technology represents a significant industrial revolution, with China poised to play a crucial role in this transformation [21]. - Major companies are increasing investments in AI infrastructure and cloud computing, with Alibaba announcing a 380 billion RMB investment in AI and cloud services [24]. - The innovative pharmaceutical sector has seen remarkable growth, with over 100 billion USD in overseas licensing agreements for Chinese innovative drugs in the first ten months of 2025 [27]. - The semiconductor industry is also expanding, with SMIC increasing its monthly production capacity significantly to meet domestic demand [27]. - The National Index of Hong Kong Technology Stocks, which includes leading companies like Tencent, Alibaba, and Xiaomi, has shown strong performance, with a cumulative increase of 179.56% since 2017 [31].

Core Insights - The overall performance of companies listed on the Sci-Tech Innovation Board (STAR Market) has shown significant improvement in Q3 2025, with a notable increase in revenue and profits, particularly in sectors like integrated circuits and innovative pharmaceuticals [1][3]. Financial Performance - A total of 584 companies reported a combined revenue of 365.855 billion RMB in Q3 2025, reflecting a year-on-year growth of 12.76% [3]. - The net profit attributable to shareholders reached 17.650 billion RMB, marking a substantial increase of 67.54% compared to the previous year [3]. - The pharmaceutical manufacturing sector reported a total revenue of 16.3 billion RMB, with a year-on-year growth of 26.1%, and a net profit turnaround to 1.096 billion RMB from a loss of 432 million RMB in the same period last year [10]. R&D Investment - Companies on the STAR Market have increased their R&D expenditures, with total R&D costs amounting to 36.627 billion RMB, a 12% increase year-on-year [6]. - Nearly half of the companies are expected to distribute dividends in 2024, with 80 companies projected to do so by mid-2025 [6]. Sectoral Highlights - The AI industry is experiencing rapid growth, driving demand for domestic semiconductor manufacturing and integrated circuit design [3]. - The semiconductor and integrated circuit sectors have shown a "chain-group" development pattern, with significant revenue growth in related industries [7]. - Companies like Cambrian and Shengyi Electronics reported explosive profit growth, with Cambrian achieving a net profit of 566.5 million RMB, a year-on-year increase of 7.6 million RMB [7]. Innovation in Pharmaceuticals - Innovative pharmaceutical companies are benefiting from the expiration of overseas patent protections, with significant collaborations leading to key advancements [4]. - Notable achievements include the partnership between Bai Li Tian Heng and Bristol-Myers Squibb, which triggered a payment of 2.5 billion USD (approximately 18.95 billion RMB) due to milestone achievements in clinical trials [10]. Specialized Equipment Sector - The specialized equipment manufacturing sector is showing signs of recovery, with total revenue of 43.82 billion RMB in Q3 2025, reflecting a year-on-year growth of 14.6% [12]. - Companies like United Imaging and Liyuan Heng reported significant profit increases due to improved market conditions and strategic focus on high-quality orders [12].

Core Viewpoint - The company has entered into a distribution and supply agreement with PT Ferron, a leading pharmaceutical company in Indonesia, for the commercialization of BRIMOCHOL™PF, an innovative drug for treating presbyopia [1] Group 1: Agreement Details - The agreement grants PT Ferron exclusive rights to import, promote, distribute, market, and sell BRIMOCHOL™PF in Indonesia [1] - The company will receive an upfront payment and may earn additional milestone payments based on specific achievements [1] Group 2: Product Information - BRIMOCHOL™PF is a preservative-free, experimental eye drop administered once daily to correct age-related near vision loss [1] - The drug developer, Tenpoint, announced that the FDA has accepted the new drug application for BRIMOCHOL™PF, with a review deadline set for January 28, 2026 [1] Group 3: Clinical Study - BRIO-II is a three-arm, multi-center, randomized, double-blind study assessing the safety and efficacy of BRIMOCHOL™PF compared to other treatments, involving 629 participants across 47 trial centers in the U.S. [1]